"Prices are going through the roof"- NSW sellers riding the wave

Property values in New South Wales are continuing to soar. In Sydney alone, prices have recovered beyond the last 2017 peak. 

In fact, in the first ten days of March alone, property values rose by 1 per cent. Based on the harbour city’s median house price, that’s a rise of over $10,000 in less than two weeks. 

But does this come as a surprise? Given the extraordinary government stimulus, home buyer concessions and record home lending spurred on by the lowest interest rates in history, it all makes sense. — even if we are in the middle of a pandemic. 

While property listings are rising, buyer demand is still outweighing supply, and it’s safe to say that FOMO is definitely dominating the market. This is driving a rate of growth that we haven’t seen for over a decade. 

All of the factors that have driven us to this unique point in the market are translating into enormous buyer interest and record sales. 

To get an understanding of what’s happening on the ground, we spoke to some of the state’s top agents about some of their most recent sales. 

Mona Vale property prices surge skywards 

According to Real Estate Agent Ben Spackman from Raine and Horne Mona Vale, buyer demand continues to outweigh supply, and this is having a significant impact on property prices. 

“The market is pretty buoyant, let’s be honest, there are way more buyers than there are sellers, and that’s the problem. 

“We’re finding it really difficult to get listings stock, and when they come up, we’ve immediately got multiple buyers chasing them — prices are going through the roof,” he said. 

Take the recent example of 14 Horst Place. An original two-storey, four-bedroom home in the centre of Mona Vale.

“We were originally guiding $1.95m on that property, but demand brought the reserve up to 2.2m, and then it sold for $2.575m,” he said. 

According to Mr Spackman, seven buyers registered to bid at the auction, and on the day three were active. With bidding starting at $2.2m, the price soared to $2.575m in about 30 seconds. 

While the property was in good condition and in a great location, Mr Spackman believes that it was a surplus of buyers that led to such a high price. 

Where is this demand coming from? Besides record home lending numbers and the lowest interest rates in history, Mr Spackman says he’s seeing increased activity due to Mona Vale’s lifestyle and price point. 

“We’re seeing a lot of interest from expats coming back into Australia. They’re initially looking at the inner-city and north shore, and those areas are getting such big prices, so they’re coming up to Mona Vale.

“It’s either that, or they’re downsizing to release some capital,” he said. 

The Mona Vale market is moving quickly. While homes were previously taking 60 to 90 days to sell, the average days on market now sits somewhere between 17 and 28.

Properties selling within a week in Umina Beach

Scott Wilson, Real Estate Agent from Richardson & Wrench Umina Beach says that the Umina Beach market is performing exceptionally well. 

“I’ve been in real estate for around 16 years in the area, and this is definitely the strongest market I’ve seen. 

“It’s also the lowest level of stock I’ve seen on the market in one time — and that’s really what’s driving those prices,” he said. 

According to Mr Wilson, while properties are still coming to market, they’re selling so quickly that there’s not enough volume to give buyers a range of options — that’s why the market is so tight. 

Mr Wilson and his team recently sold 53 Cambridge St, Umina Beach by private treaty. A three-bedroom, two-bathroom brick and tile home just 800m from the beach and a short walk from the main shopping strip. 

“At the first open home, we had 28 groups through the doors — we had five buyers making offers on the same day. 

“Instead of going back and forth with buyers and dragging negotiations out over a few weeks, we sold the property through a tender sale in a week after the first open home. 

“We asked buyers to put in their best offer in writing, along with their conditions for the sale by 5pm on Monday, and then we’d present it to the owner — the property ended up selling for $1,001,000,” he said.

Mr Wilson says that the local market is attracting more and more buyers from Sydney, explaining that local first home buyers are starting to be priced out. 

“A lot of first home buyers are now coming up from Sydney — they might have bigger deposits or are being helped out by their parents.

“Lifestyle is definitely a drawcard; what you get up here compared to what they’re buying down there for a million dollars is really different,” he said. 

The Umina Beach market, being on the southern end of the Central Coast, is also proving popular with commuters. Mr Wilson explains that unlike other areas on the Central Coast, Umina Beach has good access to train lines and the NorthConnex tunnel, which makes commuting much easier. 

For those thinking of putting their property on the market, Mr Wilson says these great selling conditions won’t last forever. 

“Now is the time to maximise where there’s limited stock on the market, because there are a lot of people in a similar position, thinking, ‘should I hold off? If I hold off I might get a little bit more.’

“But at the same time, what they need to realise is that everyone else that’s thinking this will come onto the market at the same time, creating more competition between listings. 

“More properties give buyers more choice,” he said. 

“I’ve done this for 16 years, and I haven’t seen a market like this. I’ve been through booms, bubbles and GFCs — this is the strongest I’ve seen it move,” he said. 

Inner-city markets going from strength-to-strength

Last month, Sydney home values rose 2.5 per cent — the biggest national month-on-month increase in 17 years. 

Max Klimenko and Charles Touma of Ray White Touma Group are seeing this play out in their local inner Sydney market. 

They recently sold a home on Marriott Street in Redfern off-market. The vendors purchased the home a year ago, made no updates to it, and it sold this year for $1.8m. According to Mr Touma, the vendors secured a 20 per cent return in just 12 months. 

The sale of 82 Great Buckingham Street in Redfern was also a fantastic result. The auction buyers guide for the property was $2.4m. At the auction, bids opened at $2.6m and the property sold under the hammer for $3.3m.

While industry pundits have been cautioning the relative weakness of inner-city apartment markets, there are positive signs on the horizon — over February unit values in Sydney recorded their first month of growth since April last year. 

According to Mr Klimenko, he’s seeing the unit market recover and is securing pre-Covid prices.

According to Mr Klimenko, he’s seeing the unit market recover and is securing pre-Covid prices — he recently sold a 60sqm unit at 824/8 Victoria Park Parade in Zetland prior to auction for $750k. 

“We had over 50 groups inspecting the home and most of the buyers were hovering around the 700k mark,” he said. 

He was able to secure $750k for the vendor, with an established couple from Hunterview NSW purchasing the property for their daughter. 

According to Mr Klimenko the property is the highest sale this year for a 1 bedroom unit in Zetland. 

Two markets converge to set a new precedence for price in Sydney’s inner-west

William Pereira and his team from Adrian William Real Estate were behind the sale of 2 Harney Street Marrickville. An original, two-bedroom home with double-frontage, within walking distance to both Dulwich Hill and Marrickville villages. 

On listings portals at the time, the property was the second most searched home in the state. Given its size and location, the property attracted 230 groups — of mostly young couples — through its open inspections. 

On auction day, 33 bidders were registered, with the property selling for $1.73m and $330k above reserve. 

Mr Pereira described this result as two markets converging into one to set a new precedence for price in the area. 

“We’re seeing that buyers with a budget of $1.7-1.8 million can no longer afford a three bedroom house — that pricepoint can only afford a two bedroom house,” he said. 

Mr Pereira explains that this two-bedroom property attracted buyers who had previously been looking at larger homes but had come to the realisation that in the current market, a property of that size was out of reach. 

At the same time, hopeful younger couples who have been looking at two-bedroom homes in the area were also showing interest in the property. 

“2 Harney Street, Marrickville was the example of two markets meeting in one property — an example of a sale that has introduced to the market what’s really going on,” he said. 

In addition to what Mr Pereira describes as a market frenzy, he says that clever marketing also played a part in the successful sale of this home. The team utilised creative photography and a mixture of both traditional and digital marketing to drive interest in the home. 

“We used remarketing to target potential buyers and drove them back to the property listing, and when people showed interest in the home, we were very diligent in following-up and answering questions.

“It’s like a recipe, and for this sale all the ingredients came together,” he said. 

In his local market, Mr Pereira says that what we’re experiencing is a backlog of people who had been waiting to see what would happen with Covid — these were people who didn’t have the confidence to buy during the pandemic. 

Mr Pereira explains that on an international stage, Australia is recognised as having an incredible standard of living, and just like Byron has become internationally recognised, other areas will, too. 

He expects that once borders open, there will be an influx of international buyers. 

“I don’t see it scaling backwards – as our population grows, people will start paying for convenience and accessibility,” he says.